Consider the following two mutually exclusive projects:
year cash flow (a) cash flow (b)
0 - $ 348,000 - $ 51,000
1 47,000 24,200
2 67,000 22,200
3 67,000 19,700
4 442,000 14,800
whichever project you choose, if any, you require a return of 14 percent on your investment. (a) what is the payback period for each project? (b) what is the npv for each project? (do not round intermediate calculations. round your answers to 2 decimal places (e. g., 32. (c) what is the irr for each project? (do not round intermediate calculations. enter your answers as a percentage rounded to 2 decimal places (e. g., 32. (d) what is the profitability index for each project? (do not round intermediate calculations. round your answers to 3 decimal places (e. g., 32. (e) based on your answers in (a) through (d), which project will you finally choose?

Which of the following is an example of an unsought good? a. cameron purchases a new bike. b. jordan buys paper towels. c. taylor buys cupcakes from her favorite bakery. d. riley buys new windshield wipers for her car. d

If a firm plans to issue new stock, flotation costs (investment bankers' fees) should not be ignored. there are two approaches to use to account for flotation costs. the first approach is to add the sum of flotation costs for the debt, preferred, and common stock and add them to the initial investment cost. because the investment cost is increased, the project's expected return is reduced so it may not meet the firm's hurdle rate for acceptance of the project. the second approach involves adjusting the cost of common equity as follows: . the difference between the flotation-adjusted cost of equity and the cost of equity calculated without the flotation adjustment represents the flotation cost adjustment. quantitative problem: barton industries expects next year's annual dividend, d1, to be $1.90 and it expects dividends to grow at a constant rate g = 4.3%. the firm's current common stock price, p0, is $22.00. if it needs to issue new common stock, the firm will encounter a 6% flotation cost, f. assume that the cost of equity calculated without the flotation adjustment is 12% and the cost of old common equity is 11.5%. what is the flotation cost adjustment that must be added to its cost of retaine

Acompany has $80,000 in outstanding accounts receivable and it uses the allowance method to account for uncollectible accounts. experience suggests that 6% of outstanding receivables are uncollectible. the current credit balance (before adjustments) in the allowance for doubtful accounts is $1,200. the journal entry to record the adjustment to the allowance account includes a debit to bad debts expense for $4,800. true or false